Tactical Asset Allocation - TAA

DEFINITION of 'Tactical Asset Allocation - TAA'

An active management portfolio strategy that rebalances the percentage of assets held in various categories in order to take advantage of market pricing anomalies or strong market sectors.

INVESTOPEDIA EXPLAINS 'Tactical Asset Allocation - TAA'

This strategy allows portfolio managers to create extra value by taking advantage of certain situations in the marketplace. It is as a moderately active strategy since managers return to the portfolio's original strategic asset mix when desired short-term profits are achieved.